<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
Form 10-K
Annual Report Pursuant to Section 13 or 15(d)
of the Securities Act of 1934
For the Fiscal Year Ended Commission File Number
December 31, 1998 #33-28493-A
Condev Land Fund III, Ltd.
--------------------------
(Exact Name of Registrant as
specified in its charter)
Florida #59-2943405
------------------------------- -------------------------------
(State or other jurisdiction (IRS Employer ID #)
of incorporation or
organization)
2479 Aloma Avenue
Winter Park, Florida 32792
- ------------------------------- ---------------
(Address of principal executive (Zip Code)
offices)
Registrant's telephone number, including area code (407) 679-1748
--------------
Securities registered pursuant to Section 12(b) of the Act:
None
----
Securities registered pursuant to Section 12(g) of the Act:
None
----
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 of 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No_______
-------
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ X ]
State the aggregate market value of the voting stock held by non-affiliates of
the Registrant:
Not Applicable
--------------
<PAGE>
CONDEV LAND FUND III, LTD.
Table of Contents
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
Part I
Item 1. Business 1
Item 2. Properties 2
Item 3. Legal Proceedings 2
Item 4. Submission of Matters to a Vote of Security Holders 2
Part II
Item 5. Market for Registrant's Common Equity and Related Security Holder Matters 3
Item 6. Selected Financial Data 3
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations 3
Item 8. Financial Statements and Supplementary Data 6
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure 24
Part III
Item 10. Directors and Executive Officers of the Registrant 24
Item 11. Executive Compensation 24
Item 12. Security Ownership of Certain Beneficial Owners and Management 24
Item 13. Certain Relationships and Related Transactions 25
Part IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K 26
Signatures 27
Annual Report to Limited Partners 28
</TABLE>
<PAGE>
PART I
Item 1.
Business:
--------
Condev Land Fund III, Ltd. (the "Partnership") is a Florida limited
partnership formed on February 15, 1989 under the Florida Revised Uniform
Partnership Act. The Partnership was formed for the purpose of acquiring
and holding for investment pre-development land in Central Florida. The
Partnership registered with the Securities and Exchange Commission and sold
to investors a total of 9,784 units of limited partnership interest at an
initial offering price of $250 per unit. The Partnership had collected
$2,446,000 in Limited Partnership capital as of December 31, 1989.
As provided under the terms of the Partnership Agreement the Partnership
was to be in existence until December 31, 1996. In accordance with the
Florida Limited Partnership Law and the Partnership Agreement, after
December 31, 1996 the Partnership has been in liquidation with no change in
the status of the limited partners or general partner.
Since the Partnership is in liquidation, the primary objective of the
Partnership is to sell properties at current market prices and distribute
the net proceeds to partners. To this end, the General Partner is
constantly monitoring area developments which are likely to effect the
salability of each property. This includes area commercial and residential
development, comparable sales transactions, road and highway improvements,
requests for zoning or comprehensive land use changes, and changes in the
availability of utilities. The General Partner or its representatives
attend county commission meetings, planning and zoning hearings and
community information meetings as part of this endeavor. Properties are
priced after consideration is given to all of these factors.
In addition to trying to sell the portfolio properties, the Partnership
must manage the properties in the best interest of the partners. This
includes traditional property maintenance such as insuring the property
against liability, paying and appealing for adjustment, when appropriate,
real estate taxes, mowing and trash removal. It also entails reacting
promptly to area developments to insure that vested development rights are
preserved or marketability of the property is enhanced. In some cases, it
is necessary to retain consultants to assist with this effort. In other
cases, expenditure of partnership reserves is required to keep the property
properly positioned for sale.
Properties are marketed through a combination of direct advertising,
including "For Sale" signs located on each property, constant contact with
the local, national and international brokerage communities, and direct
contact with potential purchasers. Extensive marketing materials and
relevant development information is maintained and constantly updated for
use by potential buyers.
The Partnership has no employees. Messrs. Robert N. Gardner and Joseph J.
Gardner are the general partners of Condev Associates, a Florida general
partnership, which is the General Partner of the Partnership (the "General
Partner").
Item 2.
Properties:
----------
Since its inception, the Partnership has purchased two properties for
investment in the Central Florida area. Part of one parcel was sold during
1994. There were no sales of land during 1995 and 1997, and another part of
one property was sold during 1996. As of December 31, 1998, the partnership
owned or had an investment in two properties.
The following is a summary of all properties acquired by the Partnership:
Parcel 1:
--------
On May 31, 1991, Condev Osceola Joint Venture purchased two parcels of land
aggregating 8.6 acres within the Kyng's Heath commercial subdivision on
S.R. 535 near its intersection with Highway 192 in Osceola County, Florida.
The property is zoned tourist-commercial in Osceola County, Florida. At the
time of closing, the Partnership acquired a 90% interest in Condev Osceola
Joint Venture.
The purchase price of this property was $1,740,000 or $4.64 per square
foot.
During the third quarter of 1994, an international investment group
purchased four parcels of land totaling approximately 9.4 acres adjacent to
this parcel. As part of this transaction,
1
<PAGE>
Condev Osceola Joint Venture sold a small corner of its adjoining property
to this group to accommodate a realignment of a road serving both
properties. The total purchase price for the 28,607 square feet sold was
$175,000, or $6.12 per square foot. The Partnership's share of this sale
was 90%, or $144,000. In November, 1994 a total of $44,028 was distributed
to limited partners representing return of capital and profits on the sale
of this parcel. The remaining proceeds were used to pay closing costs and
to augment the Partnership's cash position.
On August 28, 1996, Condev Osceola Joint Venture concluded the sale of a
5.08 acre part of this parcel. The purchase price was $1,250,000, or
approximately $5.65 per square foot. The buyer made a cash payment at
closing of $350,000 and issued its promissory note in the amount of
$900,000 to the Joint Venture. The Joint Venture retained a mortgage on
the land until the note was repaid. After closing expenses and real estate
commissions paid to outside brokers, the net cash received by the Joint
Venture was $266,000. Of this amount, $225,032 was distributed to limited
partners of Condev Land Fund III, Ltd., and $25,000 was distributed to
limited partners in Condev Osceola, Ltd., the other 10% investor in the
Joint Venture. The balance of $15,968 was retained in the Joint Venture to
provide for future anticipated costs and expenses. Upon repayment of the
$900,000 note on April 2, 1997, the Partnership received its share in the
amount of $810,000 and distributed $799,940 to limited partners. The Joint
Venture continues to own 2.94 acres of land in the Kyng's Heath
subdivision.
Parcel 2:
--------
On August 6, 1993, the Partnership purchased a 10-acre parcel of
commercially zoned land fronting on the east side of U.S. Highway 27 in
Lake County, Florida for $400,000. The site is approximately 1.5 miles
north of the U.S. 192 and U.S. 27 intersection. The southwest corridor of
Orlando is an area that continues to experience rapid gain in employment,
population and household growth and commercial development.
Based on developments in the immediate area of this property, it is clear
that the Partnership will be in a better competitive position to sell the
property if sewer and water service is available to the property limits.
Accordingly, the General Partner has engaged an engineering firm to design
the improvements and file for permits for the extendion of such service to
the property. The Partnership has obtained the necessary development
permits and construction has started. If all goes as scheduled,
construction should be completed by April 1999. The costs of these
improvements will be reimbursed to the Partnership by buyers of the
property.
Item 3.
Legal Proceedings:
-----------------
As of December 31, 1998, the Partnership was not subject to any pending
legal proceedings.
Item 4.
Submission of Matters to a Vote of Security Holders:
---------------------------------------------------
No matter was submitted to Unit Holders for a vote during the fourth
quarter of the year ended December 31, 1998.
2
<PAGE>
PART II
Item 5.
Markets for Registrant's Common Equity and Related Security Holder Matters:
--------------------------------------------------------------------------
(a) There has not been a public secondary market and it is not anticipated
that a public secondary market for the Units will develop. In September, LP
Investors, LLC, an investment company based in Atlanta, Georgia, exercised
their rights as a limited partner and requested a list of all beneficial
owners and the number of units owned by each. As required by the
Partnership Agreement, this information was provided. LP Investors paid a
fee of $100 to the Partnership in reimbursement of the Partnership's costs
associated with providing the list. LP Investors subsequently wrote to each
beneficial owner offering to purchase their units for $43.75 per unit, less
the $25 transfer fee charged by the Partnership. Neither the Partnership,
the General Partner, nor any of its officers, employees or affiliates is in
any way connected with this offer
(b) As of December 31, 1998, there were approximately 276 holders of
record of the Units of the Partnership.
(c) There are no regularly scheduled distributions to limited partners.
Distributions are made subsequent to sale of Partnership properties after
provision has been made for adequate reserves to cover anticipated future
expenses of the Partnership. Limited partners received cash distributions
totaling $-0-, $799,940, and $225,032 during the years ended December 31,
1998, 1997 and 1996.
Item 6.
Selected Financial Data:
-----------------------
Year Ended December 31,
-----------------------
<TABLE>
<CAPTION>
1998 1997 1996 1995 1994
----------- ----------- ---------- ----------- ----------
<S> <C> <C> <C> <C> <C>
Revenue $ 5,535 $ 7,853 $ 56,995 $ 7,457 $ 76,218
Net Income (Loss) (25,864) (41,881) 38,476 ( 30,888) 63,976
Total Assets 1,008,650 1,035,001 1,876,335 2,064,061 2,093,779
Partners' Capital 1,008,650 1,034,514 1,876,335 2,062,891 2,093,779
</TABLE>
The above selected financial data should be read in conjunction with the
financial statements and related notes appearing elsewhere in this annual
report.
Item 7.
Management's Discussion and Analysis of Financial Condition and Results of
--------------------------------------------------------------------------
Operations:
----------
Year 2000
---------
The Partnership is heavily dependent upon a computer system to accurately
maintain limited partner records, including name and address information,
number of units owned, and distribution historical records. The Partnership
is utilizing a system which was specially designed for the Partnership in
1990, and it is possible that the system will be affected by the date
change which will occur at the end of 1999. The Partnership has engaged a
computer consultant to evaluate the potential problems, and make system
changes if necessary so the operation of the Partnership will not be
affected by the date change. Testing on the system is expected to be
completed by March, 1999. It is anticipated that the cost of evaluating the
current system and bringing it up to date to be year 2000 compliant will be
less than $1,000. The Partnership's computer records are backed up on a
weekly basis, so all of the stored information is available from a
secondary source. Even if the system were to be completely shut down by the
date change at the end of 1999, the data necessary to continue operation of
the Partnership is available and could readily be adapted to a new system
which is year 2000 compliant, so no significant interruption in the
operations of the Partnership is anticipated.
January 1, 1998 through December 31, 1998:
-----------------------------------------
During 1998, the Partnership continued to manage the portfolio properties
and direct its efforts towards positioning the remaining two properties for
sale. The areas in which the properties are located continue to mature,
and sales prospects are encouraging at this time.
3
<PAGE>
For the year ended December 31, 1998, the Partnership had total revenue of
$5,535, consisting primarily of interest earned on cash and cash
equivalents during the year. This compares to total revenues of $7,853 for
the year ended December 31, 1997. There were no sales of property by
either the Partnership or the Joint Venuure during 1998 or 1997.
Operating expenses totaled $19,623 for 1998 compared to $18,227 for 1997.
Most of these expenses relate to the management and administration of the
Partnership. Equity in the loss of Condev Osceola Joint Venture decreased
from $31,507 in 1997 to $11,776 in 1998. The 1997 loss included a one-time
consulting fee of $47,175 relating to the partial sale of property,
partially offset by interest income relating to the same sale in the amount
of $25,000.
Total Assets at December 31, 1998 were $1,008,650 compared to $1,035,001 at
December 31, 1997. As previously mentioned, there were no sales of property
and no distributions to limited partners during 1998. Assets can be
expected to decline as properties are sold and the proceeds are distributed
to limited partners. Liquidity remained at a satisfactory level. Cash and
cash equivalents at December 31, 1998 were $67,118 as compared to $90,357 a
year earlier.
Financial projections - 1999
----------------------------
The business of the Partnership is to own, manage and sell, as market
conditions permit, pre-development land in the central Florida area. Due to
the nature of the commercial real estate market in the central Florida
area, it is difficult to project when individual properties will sell or
when the entire portfolio will be liquidated. Because of these
uncertainties, the General Partner has established reserves to fund real
estate taxes, costs associated with maintaining the properties and other
required services such as partnership administration, accounting and legal.
The reserve will be replenished from future land sales as needed.
For 1999, the General Partner estimates that approximately $15,500 will be
required to pay real estate taxes on the properties held by the Partnership
and Condev Osceola Joint Venture. In addition, the General Partner
estimates that property associated holding costs will total approximately
$8,000 during 1999 and the costs of administration, legal and accounting
will require approximately $9,000. These three categories of expense,
totaling $32,500, will be paid from Partnership reserves which were $67,118
as of December 31, 1998. Assuming no sales of property during 1999, the
Partnership has adequate reserves to cover approximately two (2) years of
operating expenses.
The General Partner estimates that one property will be sold in 1999,
generating net proceeds to the partnership of approximately $690,000. If
this estimation proves to be accurate, there will a distribution of most of
the net proceeds to partners during 1999. The General Partner regards the
present level of reserves adequate to fund future expenses.
The General Partner expects to place the one remaining Partnership property
under contract in 1999 which is estimated to close during 2000. It is
estimated that it will require another two (2) years to complete the sale
of properties held by the Partnership or by the joint venture in which the
Partnership is a participant.
January 1, 1997 through December 31, 1997:
-----------------------------------------
During 1997, the Partnership continued to manage the portfolio properties
and direct its efforts towards selling the remaining two properties.
For the year ended December 31, 1997, the Partnership had total revenue of
$7,853, consisting primarily of interest earned on cash and cash
equivalents during the year. This compares to total revenues of $56,995
for the year ended December 31, 1996. The 1996 figure includes $50,650 in
net income from the Partnership's joint venture, Condev Osceola Joint
Venture, the owner of parcel #2. See Item 2, Properties. There were no
sales of property by either the Partnership or the Joint Venture during
1997.
Operating expenses totaled $18,227 for 1997 compared to $18,519 for 1996.
Most of these expenses relate to the management and administration of the
Partnership. However, the equity in the loss of Condev Osceola Joint
Venture was $31,507 for 1997. The reason for this loss was a consulting
expense in the amount of $47,170 relating to the collection and subsequent
payoff of a mortgage note held by the Joint Venture. This consulting
expense was partially offset by interest income on the same mortgage note
in the amount of $25,000. As mentioned in the preceding paragraph, Condev
Osceola Joint Venture had a profit in 1996.
Total Assets at December 31, 1997 were $1,035,001 compared to $1,876,335 at
December 31, 1996. This represents a decrease of $841,334, and was
primarily caused by the distribution of $799,940 to limited partners
following repayment of the mortgage note held by Condev Osceola Joint
Venture, plus reported operating losses. Assets will continue to decline as
properties are sold
4
<PAGE>
and the proceeds are distributed to limited partners. Liquidity remained at
a satisfactory level. Cash and cash equivalents at December 31, 1997 stood
at $90,357 as compared to $101,678 a year earlier.
January 1, 1996 through December 31, 1996:
-----------------------------------------
The Partnership continued to manage the portfolio properties and to attempt
to present the properties to potential purchasers.
For the year ended December 31, 1996, the Partnership reported total
revenue of $56,995. This included $50,650 equity in income of joint
venture. This compares to total revenue of $7,457 for the year ended
December 31, 1995. The 1996 equity income resulted from the sale of 5.08
acres by the Joint Venture. Refer to Item 2, Properties, Parcel 1 for
details. The change in interest income reflects varying cash levels during
the two years.
Operating expenses totaled $18,519 for the year ended December 31, 1996,
compared to $16,904 for the year ended December 31, 1995. The 1996 figure
does not include $1,124 in net expenses incurred in Condev Osceola Joint
Venture because the joint venture reported a profit for the year. The
profit relates to the sale of the part of Parcel 1 mentioned above and
interest on the related purchase money mortgage. Total expenses for the
Joint Venture, consisting primarily of real estate taxes were essentially
unchanged from the previous year.
The net profit reported for the year ended December 31, 1996 was $38,476,
compared to a loss of $30,888 for the year ended December 31, 1995.
At year-end 1996, total assets of the Partnership were $1,876,335, compared
with $2,064,061 at year-end 1995. This decline reflects the property sale
and related distribution to limited partners during 1996. The Partnership
had no liabilities at December 31, 1996. Partners capital decreased from
$2,062,891 at December 31, 1995 to $1,876,335 at December 31, 1996, again
the result of Partnership profits offset by distributions to limited
partners during the year.
5
<PAGE>
Item 8.
Financial Statements and Supplementary Data:
-------------------------------------------
I. Condev Land Fund III, Ltd.
----------------------------
<TABLE>
<CAPTION>
Page
<S> <C>
INDEPENDENT AUDITORS' REPORT 7
FINANCIAL STATEMENTS
Balance sheets 8
Statements of operations 9
Statements of partners' capital 10
Statements of cash flows 11
Notes to financial statements 12 - 16
II. Condev Osceola Joint Venture
---------------------------------
INDEPENDENT AUDITORS' REPORT 17
FINANCIAL STATEMENTS
Balance sheets 18
Statements of operations 19
Statements of partners' capital 20
Statements of cash flows 21
Notes to financial statements 22 - 25
</TABLE>
6
<PAGE>
INDEPENDENT AUDITORS' REPORT
----------------------------
The Partners
Condev Land Fund III, Ltd.
Winter Park, Florida
We have audited the accompanying balance sheets of Condev Land Fund III,
Ltd. (a Florida Limited Partnership) as of December 31, 1998 and 1997, and the
related statements of operations, partners' capital and cash flows for each of
the three years in the period ended December 31, 1998. These financial
statements are the responsibility of the General Partner. Our responsibility is
to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Condev Land Fund III, Ltd.
as of December 31, 1998 and 1997, and the results of its operations and its cash
flows for each of the three years in the period ended December 31, 1998, in
conformity with generally accepted accounting principles.
OSBURN, HENNING AND COMPANY
Orlando, Florida
January 15, 1999
7
<PAGE>
CONDEV LAND FUND III, LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
December 31, 1998 and 1997
<TABLE>
<CAPTION>
1998 1997
---------- ----------
<S> <C> <C>
ASSETS
Cash and cash equivalents $ 67,118 $ 90,357
Accounts receivable - 2,494
Land, at cost (Note 2) 405,467 405,467
Investment in joint venture (Note 3) 533,596 534,372
Organization costs, less accumulated
amortization of $2,190 in 1998 and
$2,190 in 1997 2,311 2,311
---------- ----------
$1,008,650 $1,035,001
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
Liabilities
Accounts payable $ - $ 487
---------- ----------
Partners' capital (deficit):
General partner (996) (738)
Limited partners 1,009,646 1,035,252
---------- ----------
Total partners' capital 1,008,650 1,034,514
---------- ----------
$1,008,650 $1,035,001
========== ==========
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
8
<PAGE>
CONDEV LAND FUND III, LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
Years Ended December 31, 1998, 1997 and 1996
<TABLE>
<CAPTION>
1998 1997 1996
--------- --------- --------
<S> <C> <C> <C>
Revenue:
Interest income $ 3,660 $ 6,053 $ 4,570
Other income 1,875 1,800 1,775
Equity in income of joint venture
(Note 3) - - 50,650
-------- -------- -------
5,535 7,853 56,995
-------- -------- -------
Expenses:
Professional fees 8,700 7,000 7,000
Other expenses 8,058 8,452 9,264
Taxes and permits 2,865 2,775 2,255
Equity in loss of joint venture
(Note 3) 11,776 31,507 -
-------- -------- -------
31,399 49,734 18,519
-------- -------- -------
Net income (loss) $(25,864) $(41,881) $38,476
======== ======== =======
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
9
<PAGE>
CONDEV LAND FUND III, LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' CAPITAL
Years Ended December 31, 1998, 1997 and 1996
<TABLE>
<CAPTION>
General Limited
Partner Partners Total
-------- ----------- -----------
<S> <C> <C> <C>
Balances (deficit), December 31, 1995 $(186) $2,063,077 $2,062,891
Distributions to partners (Note 4) - (225,032) (225,032)
Net income (loss) (133) 38,609 38,476
----- ---------- ----------
Balances (deficit), December 31, 1996 (319) 1,876,654 1,876,335
Distributions to partners (Note 4) - (799,940) (799,940)
Net income (loss) (419) (41,462) (41,881)
----- ---------- ----------
Balances (deficit), December 31, 1997 (738) 1,035,252 1,034,514
Net income (loss) (258) (25,606) (25,864)
----- ---------- ----------
Balances (deficit), December 31, 1998 $(996) $1,009,646 $1,008,650
===== ========== ==========
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
10
<PAGE>
CONDEV LAND FUND III, LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
Years Ended December 31, 1998, 1997 and 1996
<TABLE>
<CAPTION>
1998 1997 1996
---------- ---------- ----------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (25,864) $ (41,881) $ 38,476
Adjustments to reconcile net income
(loss) to net cash (used in)
operating activities:
Equity in (income) loss of
joint venture 11,776 31,507 (50,650)
Amortization - - 2,075
(Increase) decrease in accounts
receivable 2,494 (2,494) -
Increase (decrease) in accounts
payable (487) 487 (1,170)
-------- --------- ---------
Net cash (used in)
operating activities (12,081) (12,381) (11,269)
-------- --------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment in joint venture (11,000) (9,000) (9,099)
Distributions from joint venture - 810,000 225,000
Capitalized land related costs (158) - -
-------- --------- ---------
Net cash provided by
(used in) investing
activities (11,158) 801,000 215,901
-------- --------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Distributions to partners - (799,940) (225,032)
-------- --------- ---------
Net increase (decrease) in
cash and cash equivalents (23,239) (11,321) (20,400)
CASH AND CASH EQUIVALENTS, BEGINNING 90,357 101,678 122,078
-------- --------- ---------
CASH AND CASH EQUIVALENTS, ENDING $ 67,118 $ 90,357 $ 101,678
-------- ========= =========
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
11
<PAGE>
CONDEV LAND FUND III, LTD.
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies
Organization
------------
Condev Land Fund III, Ltd. (the Partnership) was formed on
February 15, 1989 pursuant to the provisions of the Florida
Revised Uniform Limited Partnership Act for the purpose of
acquiring and holding unimproved land in Central Florida for
investment. The Partnership was formed with an initial capital
contribution of $1,000 from the general partner, Condev
Associates, and the issuance of 9,784 units of limited
partnership interest at $250 per unit.
The terms of the partnership agreement provided that the
Partnership will continue in existence until December 31, 1996.
However, the Partnership's operations will continue until all
investments of the Partnership are sold and proceeds distributed
to the partners.
Use of Estimates
----------------
In preparing the financial statements, management is required to
make estimates and assumptions that affect the reported amounts
of assets and liabilities as of the date of the financial
statements and revenues and expenses for the period. Actual
results could differ significantly from those estimates.
Organization Costs
------------------
The Partnership has capitalized all organization costs. Upon sale
of land, each parcel is allocated a portion of these costs based
on the ratio of total acquisition cost to the net proceeds of the
offering available to purchase properties for investment. The
accompanying statements of operations include $-0-, $-0-, $2,075
of organization costs amortization for the years ended 1998, 1997
and 1996, respectively, from sales of land by the joint venture
in which the Partnership has an investment. For tax purposes, the
Partnership is amortizing organization costs over five years.
Land
----
Land, held for investment, is stated at the lower of cost or fair
value. Land is assessed for impairment when the Partnership
believes that events or changes in circumstances indicate that
its carrying amount may not be recoverable. Costs that clearly
relate to land development projects are capitalized. Interest
costs, real estate taxes and insurance are capitalized while
development is in progress. When development is complete, these
costs are expensed.
CONTINUED ON NEXT PAGE
12
<PAGE>
CONDEV LAND FUND III, LTD.
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies - (Continued)
Investments in Joint Ventures
-----------------------------
Investments in joint ventures are accounted for using the equity
method.
Income Taxes
------------
The Partnership functions as a conduit for income tax purposes.
As such, the Partnership files an information tax return on which
it allocates its revenue and expenses among the partners as
required by the partnership agreement. The partners are required
to report such items on their respective income tax returns.
Cash and Cash Equivalents
-------------------------
The Partnership considers all highly liquid debt instruments
purchased with a maturity of three months or less to be cash
equivalents. At December 31, 1998, cash and cash equivalents
include $64,509 invested in Nations Government Money Market Daily
Shares
Note 2. Land
At December 31, 1998 and 1997, land consisted of a ten-acre parcel,
zoned commercial, in Lake County, Florida.
Note 3. Investment in Joint Venture
The Partnership owns a 90% interest (which was acquired in 1991) in
Condev Osceola Joint Venture (a Florida joint venture) (the Joint
Venture) whose purpose is to acquire and hold one parcel of land,
comprised of approximately 2.9 acres located in Osceola County,
Florida, for investment purposes. The remaining 10% interest is owned
by Condev Osceola, Ltd., an affiliate of the Partnership's general
partner. The Partnership's investment in the Joint Venture as of
December 31, and its equity in income (loss) of the Joint Venture for
the years then ended are as follows:
<TABLE>
<CAPTION>
EQUITY IN
INCOME
YEAR INVESTMENT (LOSS)
---- ---------- ---------
<S> <C> <C>
1998 $ 533,596 $(11,776)
1997 $ 534,372 $(31,507)
1996 $1,366,879 $ 50,650
</TABLE>
CONTINUED ON NEXT PAGE
13
<PAGE>
CONDEV LAND FUND III, LTD.
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
Note 3. Investment in Joint Venture - (Continued)
During the year ended December 31, 1996, the Joint Venture sold a
parcel of land at a gain of $57,526. Accordingly, the equity in income
of joint venture includes a gain on sale of land of $51,774 and a loss
from operations of the Joint Venture of $(1,124).
A summary of the assets, liabilities, and venturers' capital of Condev
Osceola Joint Venture as of December 31, 1998 and 1997 is as follows:
<TABLE>
<CAPTION>
1998 1997
--------- ---------
<S> <C> <C>
Assets
------
Cash $ 4,032 $ 4,032
Note receivable 1,222 -
Investment in land 589,715 589,715
-------- --------
$592,884 $593,747
======== ========
Liabilities and Venturers' Capital
----------------------------------
Venturers' capital $592,884 $593,747
======== ========
</TABLE>
The Joint Venture had revenue of $-0-, $25,000, and $75,926 during the
years ended December 31, 1998, 1997 and 1996, respectively, and net
income (loss) of $13,085, $(35,008), and $56,278, respectively.
Note 4. Allocations and Distributions to Partners
Operations (excluding land sales)
---------------------------------
Pursuant to the partnership agreement, cash flow and profits and
losses from operations are allocated and distributed 99% to the
limited partners and 1% to the general partner. No distributions
attributable to cash flow were made during the years ended December
31, 1998, 1997 or 1996.
CONTINUED ON NEXT PAGE
14
<PAGE>
CONDEV LAND FUND III, LTD.
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
Note 4. Allocations and Distributions to Partners - (Continued)
Land sales
----------
With respect to disposition of parcels of land, the allocations
and distributions shall be made as follows:
1. To the limited partners, an amount equal to the
Partnership's cost of the parcel disposed of;
2. To the limited partners, an amount equal to real estate
taxes, and organization and syndication expenses
allocable to the parcel disposed of;
3. To the limited partners, an amount equal to 10% per year
non-compounded return on such distributions minus
previous distributions of cash flows;
4. To the general partner and limited partners, 20% and 80%,
respectively, of the net cash proceeds after the above
distributions.
For purposes of making the above described computations, the
Partnership books will be deemed to close as of the month-end
closest to the date of sale.
The limited partners received distributions of $-0-, $799,940,
and $225,032 during the years ended December 31, 1998, 1997 and
1996, respectively, attributable to net cash proceeds from sales
of land held through Condev Osceola Joint Venture.
Note 5. Related Party Transactions
The partnership agreement permits the general partner or its
affiliates to receive an acquisition fee or a real estate commission
from sellers in an amount not to exceed 5% of the gross purchase price
of land purchased by the Partnership, so long as the total acquisition
fee, including that paid to unaffiliated parties, does not exceed 10%
of the gross purchase price. No acquisition fees were paid during the
years ended December 31, 1998, 1997 or 1996, as no properties were
purchased.
CONTINUED ON NEXT PAGE
15
<PAGE>
CONDEV LAND FUND III, LTD.
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
Note 5. Related Party Transactions - (Continued)
When properties are sold, an affiliate of the general partner may be
paid real estate commissions in amounts customarily charged by others
rendering similar services, with such commissions, plus commissions
paid to nonaffiliates, not to exceed 10% of the gross sales price. No
real estate commissions were paid during the years ended December 31,
1998, 1997 and 1996, with respect to sales, as no sales occurred.
The general partner is obligated to loan up to $100,000 to the
Partnership during its term to meet working capital requirements. No
such loans were made to the Partnership during the years ended
December 31, 1998, 1997 and 1996.
The general partner earned certain fees for administration and
management services provided, pursuant to the partnership agreement.
Such fees amounted to $3,744 for the years ended December 31, 1998 and
1997 and $3,720 for the year ended December 31, 1996.
16
<PAGE>
INDEPENDENT AUDITORS' REPORT
----------------------------
The Venturers
Condev Osceola Joint Venture
Winter Park, Florida
We have audited the accompanying balance sheets of Condev Osceola Joint
Venture (a Florida Joint Venture) as of December 31, 1998 and 1997, and the
related statements of operations, venturers' capital, and cash flows for each of
the three years in the period ended December 31, 1998. These financial
statements are the responsibility of the Joint Venture's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Condev Osceola Joint Venture
as of December 31, 1998 and 1997, and the results of its operations and its cash
flows for each of the three years in the period ended December 31, 1998, in
conformity with generally accepted accounting principles.
OSBURN, HENNING & COMPANY
Orlando, Florida
January 15, 1999
17
<PAGE>
CONDEV OSCEOLA JOINT VENTURE
(A Florida Joint Venture)
BALANCE SHEETS
December 31, 1998 and 1997
<TABLE>
<CAPTION>
1998 1997
--------- ---------
<S> <C> <C>
ASSETS
Cash $ 1,947 $ 4,032
Due from related party (Note 2) 1,222 -
Land, at cost 589,715 589,715
--------- ---------
$ 592,884 $ 593,747
========= =========
LIABILITIES AND VENTURERS' CAPITAL
Liabilities $ - $ -
--------- ---------
Venturers' capital 592,884 593,747
--------- ---------
$ 592,884 $ 593,747
========= =========
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
18
<PAGE>
CONDEV OSCEOLA JOINT VENTURE
(A Florida Joint Venture)
STATEMENTS OF OPERATIONS
Years Ended December 31, 1998, 1997 and 1996
<TABLE>
<CAPTION>
1998 1997 1996
---------- --------- --------
<S> <C> <C> <C>
Revenue:
Gain on land sale $ - $ - $ 57,526
Interest income - 25,000 18,400
-------- -------- --------
- 25,000 75,926
-------- -------- --------
Expenses:
Real estate taxes 10,260 10,266 18,343
Consulting expense - 47,170 -
Other expenses 2,825 2,572 1,305
-------- -------- --------
13,085 60,008 19,648
-------- -------- --------
Net income (loss) $(13,085) $(35,008) $ 56,278
======== ======== ========
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
19
<PAGE>
CONDEV OSCEOLA JOINT VENTURE
(A Florida Joint Venture)
STATEMENTS OF VENTURERS' CAPITAL
Years Ended December 31, 1998, 1997 and 1996
<TABLE>
<CAPTION>
Condev Land Condev
Fund III, Ltd. Osceola, Ltd. Total
--------------- -------------- -----------
<S> <C> <C> <C>
Balances at December 31, 1995 $1,532,130 $170,237 $1,702,367
Contributions 9,099 1,011 10,110
Distributions (225,000) (25,000) (250,000)
Net income (loss) 50,650 5,628 56,278
---------- -------- ----------
Balances at December 31, 1996 1,366,879 151,876 1,518,755
Contributions 9,000 1,000 10,000
Distributions (810,000) (90,000) (900,000)
Net income (loss) (31,507) (3,501) (35,008)
---------- -------- ----------
Balances at December 31, 1997 534,372 59,375 593,747
Contributions 11,000 1,222 12,222
Net income (loss) (11,776) (1,309) (13,085)
---------- -------- ----------
Balances at December 31, 1998 $ 533,596 $ 59,288 $ 592,884
========== ======== ==========
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
20
<PAGE>
CONDEV OSCEOLA JOINT VENTURE
(A Florida Joint Venture)
STATEMENTS OF CASH FLOWS
Years Ended December 31, 1998, 1997 and 1996
<TABLE>
<CAPTION>
1998 1997 1996
---------- ---------- ----------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $(13,805) $ (35,008) $ 56,278
Adjustments to reconcile net
income (loss) to net cash
(used in) operating activities:
Gain on land sale - - (57,526)
Decrease in due to
related party - (988) -
-------- --------- ---------
Net cash (used in)
operating activities (13,805) (35,996) (1,248)
-------- --------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from land sale, net of
closing costs - - 269,826
Note receivable proceeds - 900,000 -
-------- --------- ---------
Net cash provided by
investing activities - 900,000 269,826
-------- --------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES
Capital contributions 11,000 10,000 10,110
Distributions to partners - (900,000) (250,000)
-------- --------- ---------
Net cash provided by (used
in) financing activities 11,000 (890,000) (239,890)
-------- --------- ---------
Net increase (decrease)
in cash (2,085) (25,996) 28,688
CASH, BEGINNING 4,032 30,028 1,340
-------- --------- ---------
CASH, ENDING $ 1,947 $ 4,032 $ 30,028
======== ========= =========
</TABLE>
NONCASH INVESTING ACTIVITY:
During 1996, the Joint Venture sold a parcel of land, receiving $269,826 in
cash and a $900,000 note receivable.
The Notes to Financial Statements are an integral part of these statements.
21
<PAGE>
CONDEV OSCEOLA JOINT VENTURE
(A Florida Joint Venture)
NOTES TO FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies
Organization/Business Interest
------------------------------
On May 31, 1991, Condev Land Fund III, Ltd. (the Fund) and Condev
Osceola, Ltd. (Osceola) (the Venturers), both of which are Florida
Limited Partnerships in which Condev Associates is the general
partner, entered into a joint venture agreement to form Condev
Osceola Joint Venture (the Joint Venture). The Joint Venture owns
one parcel of land totaling 2.9 acres in Osceola County, Florida,
which is being held for investment purposes.
Unless terminated earlier, as provided under the terms of the joint
venture agreement, the Joint Venture will continue in existence
until December 31, 1999.
Use of Estimates
----------------
In preparing the financial statements, management is required to
make estimates and assumptions that affect the reported amounts of
assets and liabilities as of the date of the financial statements
and revenues and expenses for the period. Actual results could
differ significantly from those estimates.
Funding
-------
The Fund and Osceola are required to contribute 90% and 10%,
respectively, to the capital of the Joint Venture from time to time
as required for the Joint Venture's operations. It is the intent of
the Venturers that all cash requirements of the Joint Venture shall
come from the Venturers and, therefore, the Joint Venture shall not
be required to borrow funds.
Land
----
Land, held for investment, is stated at the lower of cost or fair
value. Land is assessed for impairment when the Joint Venture
believes that events or changes in circumstances indicate that its
carrying amount may not be recoverable. Costs that clearly relate
to land development projects are capitalized. Interest costs, real
estate taxes and insurance are capitalized while development is in
progress. When development is complete, these costs are expensed.
CONTINUED ON NEXT PAGE
22
<PAGE>
CONDEV OSCEOLA JOINT VENTURE
(A Florida Joint Venture)
NOTES TO FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies - (Continued)
Allocation/Distributions
------------------------
Profits and losses shall be allocated 90% to the Fund and 10% to
Osceola. Cash flow generated from the Joint Venture shall be
distributed only at the discretion of Condev Associates. All such
distributions shall be paid to the Venturers in the same
percentages as profits and losses.
Income Taxes
------------
The Joint Venture functions as a conduit for income tax purposes.
As such, the Joint Venture files an information tax return on which
it allocates its revenue and expenses among the Venturers as
required by the joint venture agreement. The Venturers are required
to report such items on their respective income tax returns.
Note 2. Related Party Transactions
The joint venture agreement permits the Venturers' general partner, or
an affiliate of the general partner, to receive an acquisition fee or
a real estate commission from sellers in an amount not to exceed 5% of
the gross purchase price of land purchased by the Joint Venture, so
long as the total acquisition fee, including that paid to unaffiliated
parties, does not exceed 10% of the gross purchase price. No
acquisition fees were paid during the years ended December 31, 1998,
1997 and 1996, as no properties were purchased.
When properties are sold, an affiliate of the Venturers' general
partner may be paid real estate commissions in the amounts customarily
charged by others rendering similar services. Such commissions, plus
commissions paid to nonaffiliates, are not to exceed 10% of the gross
sales price. No real estate commissions were paid during the years
ended December 31, 1998 and 1997, as no sales occurred. In connection
with the sale of land during 1996, a total of 6.4% real estate
commissions were paid to nonaffiliates.
The amount due to related party at December 31, 1998 represents
contributed capital due from Osceola.
Note 3. Note Receivable
During 1996, the Joint Venture sold land to Orlando Resort Development
Group, Inc. for $1,250,000. The Joint Venture received cash and a
mortgage note receivable of $900,000. The note receivable was paid in
full during the year ended December 31, 1997.
23
<PAGE>
Item 9.
Changes in and Disagreements with Accountants on Accounting and Financial
-------------------------------------------------------------------------
Disclosure:
----------
There were no disagreements on accounting and financial disclosures
required to be disclosed by Item 304 of Regulation S-K.
PART III
Item 10.
Directors and Executive Officers of the Registrant
--------------------------------------------------
(a) The Registrant does not have a Board of Directors. Condev Associates,
A Florida general partnership consisting of Messrs. Robert N. Gardner and
Joseph J. Gardner is the General Partner of the Partnership.
(b), (c), (d) and (e)
Robert N. Gardner and Joseph J. Gardner are brothers. The background and
experience of the partners of the General Partner are as follows:
Robert N. Gardner, age 64 has been president, a director and shareholder of
-----------------
Condev Corporation and it's predecessors since 1961. A Florida licensed
real estate broker and Class A Contractor, he serves on the boards of
directors of Nations Bank of Central Florida, N.A., and Schroeder-Manatee,
Inc.
Joseph J. Gardner, age 61 has been an officer, director and shareholder of
-----------------
Condev Corporation and its predecessors since 1961. Prior to joining
Condev Corporation, he was employed in the land department of Continental
Oil Company. Mr. Gardner is a director of Protection One, Inc. and is a
licensed real estate broker.
Condev Corporation, which has its offices located at the same address of
the General Partner and Partnership, has been operating in the Florida real
estate market since 1961. It has two active affiliates. PCD, Inc. is a
development company specializing in horizontal land development. Condev
Realty, Inc. is a Florida licensed real estate broker which concentrates on
site acquisition, land assemblage and land investment.
Item 11.
(a), (b), (c) and (d)
The Registrant has not paid and does not plan to pay any executive
compensation to the General Partners or their affiliates (other than
described in Item 13 below).
Item 12.
Security Ownership of Certain Beneficial Owners and Management:
--------------------------------------------------------------
(a) The following is a list of persons who are known to the Registrant to
be the beneficial owners of more than 5% of the total units outstanding as
of December 31, 1998:
NONE
(b) The following is a list of units beneficially owned by all partners of
the General Partner as of December 31, 1998:
NONE
(c) There are no arrangements known to the registrant, including any
pledge by any person of security of the registrant or any of its parents or
affiliates, the operation of which may at a subsequent date result in a
change in control of the registrant.
24
<PAGE>
Item 13.
(a) and (b)
Certain Relationships and Related Transactions
----------------------------------------------
The Partnership Agreement permits the General Partner or its affiliates to
receive an acquisition fee or a real estate commission from sellers in an
amount not to exceed 5% of the gross purchase price of land purchased by
the Partnership so long as the total acquisition fee, including that paid
to unaffiliated parties, does not exceed 10% of the gross purchase price.
No acquisition fees were paid during 1998, 1997, or 1996 as no property was
purchased.
When properties are sold, under certain circumstances an affiliate of the
General Partner may be paid real estate commissions in amounts customarily
charged by others rendering similar services with such commissions, plus
commissions paid to nonaffiliates not to exceed 10% of the gross sales
price. No real estate commissions were paid to the General Partner or any
affiliates during 1998, 1997 or 1996 with respect to sales.
The General Partner is obligated to loan up to $100,000 to the Partnership
during its term to meet working capital requirements. No such loans were
made to the Partnership during the period ended December 31, 1998, 1997, or
1996.
Pursuant to the Partnership agreement, the General Partner earned certain
fees for administration and management services provided. Such fees
amounted to $3,744 for the years ended December 31, 1998 and 1997 and
$3,720 for the year ended December 31, 1996.
(c) No management person is indebted to the Registrant.
(d) Not applicable.
25
<PAGE>
PART IV
Item 14.
Exhibits, Financial Statement Schedules, and Reports on Form 8-K:
----------------------------------------------------------------
(a)(1) The following financial statements and supplementary data are
included in Part II
Item 8:
I. Condev Land Fund III, Ltd.
----------------------------
<TABLE>
<CAPTION>
Page
<S> <C>
Independent Auditor's Report 7
Financial Statements
Balance Sheets - December 31, 1998 and 1997 8
Statements of Operations - Years ended
December 31, 1998, 1997 and 1996 9
Statements of Partners' Capital -
Years ended December 31, 1998, 1997 and 1996 10
Statements of Cash Flows -
Years ended December 31, 1998, 1997 and 1996 11
Notes to Financial Statements 12-16
II. Condev Osceola Joint Venture
--------------------------------
Independent Auditor's Report 17
Financial Statements
Balance Sheets - December 31, 1998 and 1997 18
Statements of Operations - Years ended
December 31, 1998, 1997 and 1996 19
Statements of Partners' Capital -
Years ended December 31, 1998, 1997 and 1996 20
Statements of Cash Flows -
Years ended December 31, 1998, 1997 and 1996 21
Notes to Financial Statements 22-23
(3) Exhibits included herein:
13 - Annual Report to Limited Partners 28
</TABLE>
(b) Reports on Form 8-K
No reports on Form 8-K have been filed by the Registrant during the
last quarter of the period covered by this report.
26
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf of the undersigned, thereunto duly authorized.
CONDEV ASSOCIATES, General Partner
Date: February 24, 1999 By: /s/ Robert N. Gardner
-------------------- ----------------------------
Robert N. Gardner, Partner
Date: February 24, 1999 By: /s/ Joseph J. Gardner
-------------------- ----------------------------
Joseph J. Gardner, Partner
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and the capacities and on the date indicated.
CONDEV ASSOCIATES, General Partner
/s/ Robert N. Gardner February 24, 1999
- --------------------------------- ------------------------
Robert N. Gardner, Partner Date
/s/ Joseph J. Gardner February 24, 1999
- --------------------------------- ------------------------
Joseph J. Gardner, Partner Date
27
<PAGE>
February 8, 1999
Condev Land Fund III, Ltd.
1998 Annual Report
Enclosed is your Schedule K-1 (Form 1065) relating to the Fund's operations for
the year ended December 31, 1998. If your investment is held by a custodian, the
K-1 is for information purposes only. A copy of this form has been sent to your
custodian.
The financial statement, on the reverse side hereof, shows a net loss for the
year ended December 31, 1998 of $25,864. This represents interest income from
short term investments less the normal costs of operating the partnership and
managing the portfolio properties. There were no sales of property during 1998.
As of December 31, 1998, the net asset value (book value) per unit of limited
partner interest was $103.19. The following is a brief description of the status
of each of the partnership's two remaining properties:
Kyng's Heath. This property is strategically located near the proposed World
- ------------
Expo Center, which seems to be headed for development, although at a delayed
pace from the initial announcements. In addition, Edwin Watts is developing the
World Golf Center on the property which adjoins the Partnership's parcel. Both
of these developments have generated numerous inquiries from prospective buyers,
but we do not have a contract on the property at this time.
U.S. Highway 27. This 10-acre commercially zoned parcel is located just north
- ---------------
of the recently opened Winn-Dixie Marketplace on US Highway 27 near U.S. Highway
192 in Lake County, Florida. Sewer and water utilities are being extended to the
property with completion anticipated by April 15, 1999. This should enhance
investor interest in the property. We continue to work towards a satisfactory
contract with one potential purchaser who has submitted a letter of intent to
purchase the property.
We hope that these two parcels will be sold during 1999. If that is the case,
there will be a final distribution to limited partners and the Partnership will
be terminated. We appreciate the patience of the limited partners while we work
to sell the remaining properties consistent with our objective of obtaining
reasonable returns for the investors.
Sincerely yours,
CONDEV ASSOCIATES
28
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C> <C>
<PERIOD-TYPE> 12-MOS 12-MOS
<FISCAL-YEAR-END> DEC-31-1998 DEC-31-1997
<PERIOD-START> JAN-01-1998 JAN-01-1997
<PERIOD-END> DEC-31-1998 DEC-31-1997
<CASH> 67,118 90,357
<SECURITIES> 0 0
<RECEIVABLES> 0 2,494
<ALLOWANCES> 0 0
<INVENTORY> 0 0
<CURRENT-ASSETS> 0 0
<PP&E> 405,467 405,467
<DEPRECIATION> 0 0
<TOTAL-ASSETS> 1,008,650 1,035,001
<CURRENT-LIABILITIES> 0 487
<BONDS> 0 0
0 0
0 0
<COMMON> 0 0
<OTHER-SE> 1,008,650 1,034,514
<TOTAL-LIABILITY-AND-EQUITY> 1,008,650 1,035,001
<SALES> 0 0
<TOTAL-REVENUES> 5,535 7,853
<CGS> 0 0
<TOTAL-COSTS> 0 0
<OTHER-EXPENSES> 31,399 49,734
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 0 0
<INCOME-PRETAX> (25,864) (41,881)
<INCOME-TAX> 0 0
<INCOME-CONTINUING> (25,864) (41,881)
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (25,864) (41,881)
<EPS-PRIMARY> 0 0
<EPS-DILUTED> 0 0
</TABLE>
